243 U.S.

415
37 S.Ct. 394
61 L.Ed. 821

STATE OF CALIFORNIA, Plff. in Err.,

v.
DESERET WATER, OIL, & IRRIGATION COMPANY.
No. 269.
Argued January 29, 1917.
Decided March 26, 1917.

Mr. John T. Nourse and Mr. U. S. Webb, Attorney General of California,

for plaintiff in error.
Messrs. Charles F. Consaul and A. H. Rickets for defendant in error.
Messrs. Charles D. Mahaffie, C. Edward Wright, and Oscar W. Lange as
amici curiae.
Mr. Justice Day delivered the opinion of the court:

The Deseret Water, Oil, & Irrigation Company brought a proceeding in

condemnation in the superior court of Mono county, California, against the
state of California, to appropriate by right of eminent domain certain lands in
that state, for the purpose of preserving and maintaining water rights, equipping
and operating canals, etc., to be used in supplying water and power to mines,
farming neighborhoods, cities, and towns and villages, and to corporations and
individuals, draining, reclaiming, and irrigating lands, equipping, operating, and
maintaining ditches, reservoirs, etc., and for the operation and maintenance of
pumps and pumping plants, electrical lighting and power plants, and electric
and power lines.

The right to make such appropriation was sustained in the superior court, but
upon appeal this judgment was reversed by the district court of appeal for the
third appellate district. Thereupon, upon motion to the supreme court of
California, the cause was transferred to that court for hearing and decision, and,
upon consideration, the judgment of the superior court was affirmed. 167 Cal.

147, 138 Pac. 981. The supreme court held that the lands belonged to the state,
and that by certain statutes of the state it had been provided that,
notwithstanding the ownership of the state, the lands might be appropriated to a
public use such as the Water Company was lawfully proposing to make of
them, and that as to such matters the state had consented to be sued in the same
manner as any private proprietor might be. A writ of error brings the case to
this court.
3

The land in question is a sixteenth section, passing to the state by virtue of the
Federal grant for school purposes (Act of 1853, 10 Stat. at L. 244, chap. 143;
Act of 1866, 14 Stat. at L. 218, chap. 219, Comp. Stat. 1913, 4878).
Afterward, a national reservation, known as the Mono Forest Reserve, was
established by proclamation of the President. This reservation included this
section 16 within its boundaries.

It was shown at the trial that the lands in question were withdrawn from sale by
the state by an act of the legislature, and it was contended they could only be
used as bases for lieu selections. The surveyorgeneral of the state offered the
lands as bases for such selections, except 40 acres, for which the state had sold
an indemnity certificate entitling the purchaser to surrender that land, and apply
for unappropriated public land in lieu thereof. All the remainder had been
offered for lieu selections, which are pending in the General Land Office.

The supreme court of California held that the title to the lands was completely
vested in the state, and subject to condemnation at the instance of the Water
Company.

A motion to dismiss for want of jurisdiction has been submitted. As we shall

have occasion to see in the further discussion of the case, its disposition
depended upon the construction of statutes of the United States, and the opinion
of the state court shows that these statutes were considered and Federal rights
asserted under them denied. Nor can we agree that there was a local ground of
decision broad enough to sustain the judgment of the state court independently
of the construction and effect given to the Federal statute. The controlling effect
of the Federal statutes is conceded in the opinion of the state court, and must
necessarily follow in view of the nature of the rights dealt with. In this situation
this court has jurisdiction. Miedreich v. Lauenstein, 232 U. S. 236, 242, 58 L.
ed. 584, 589, 34 Sup. Ct. Rep. 309; North Carolina R. Co. v. Zachary, 232 U. S.
248, 257, 58 L. ed. 591, 595, 34 Sup. Ct. Rep. 305, Ann. Cas. 1914C, 159, 9 N.
C. C. A. 109; Rogers v. Hennepin County, 240 U. S. 184, 188, 60 L. ed. 594,
597, 36 Sup. Ct. Rep. 265.

The Federal statutes involved are 2275 and 2276 of the Revised Statutes of
the United States, as amended in 1891 (26 Stat. at L. 796, 797, chap. 384,
Comp. Stat. 1913, 4860, 4861). They are found in the margin.1 as we have
already stated, the state has elected to surrender this section 16 to the United
States, asking compensation in other lands for the same under the provisions
contained in the sections of the Federal statutes just referred to. It is the
contention of the state that, because of such action, the lands in question in
equity belong to the United States, and that consequently they could not be
condemned for the uses of the Water Company.

The controversy reduces itself to the precise question whether, when a forest
reservation, subsequently proclaimed, includes within its limits a school section
surveyed before the establishment of the reservation, the state may, under
2275, Revised Statutes of the United States, as amended in 1891, waive its right
to such section and select other lands in lieu thereof.

The first part of the section, giving the right to select lands in lieu of such as
were settled upon with a view to pre-emption or homestead, is clearly limited to
settlements made before survey of lands in the field, and under the following
provision, giving the right of selection to the state where the lands are mineral
or are included in an Indian, military, or other reservation, or are otherwise
disposed of by the United States, it well may be that, in the absence of the
proviso, the right of selection would be confined to instances where the lands
were unsurveyed when found to be mineral or included in a reservation, and
this because if the lands were unreserved and not known to be mineral when
surveyed, the title would then vest in the state (Sherman v. Buick, 93 U. S. 209,
23 L. ed. 849; Heydenfedt v. Daney Gold & S. Min. Co. 93 U. S. 634, 23 L. ed.
995, 13 Mor. Min. Rep. 204; United States v. Morrison, 240 U. S. 192, 204,
207, 60 L. ed. 599, 605, 606, 36 Sup. Ct. Rep. 326), and because lieu selections
are usually, although not always, permitted where the right to the place lands is
cut off before the time for the title to become vested. But the proviso, which
was not originally in the statute, is an important part of it, and, according to a
familiar rule, must be given some effect. It reads:

10

'Where any state is entitled to said sections sixteen and thirty-six, or where said
sections are reserved to any territory, notwithstanding the same may be mineral
land or embraced within a military, Indian, or other reservation, the selection of
such lands in lieu thereof by said state or territory shall be a waiver of its right
to said sections.' This language, while not as clear as it might be, operates, as
we interpret it, to give to the state a right to waive its right to such lands where,
as in this case, the same are included in a forest reservation after survey, that is,
after the title vests in the state. Unless this proviso refers to lands the title to

which has passed to the state, it adds nothing to the statute and performs no
office whatever. This construction preserves the integrity of forest reservations,
and permits the state to acquire other lands not surrounded by large tracts in
such reservations which are withdrawn from settlement.
11

It is true that the interpretation of the statute has not been uniform in the
Department of the Interior, and it has been otherwise construed in at least one of
the Federal courts. Hibberd v. Slack, (U. S. C. C. S. D. Cal.) 84 Fed. 571. But
the interpretation for which the state insists has been long given to it by the
Interior Department. It was more than suggested in Gregg v. Colorado, 15 Land
Dec. 151, 154, and Rice v. California, 24 Land Dec. 14, 15, was adopted upon
full consideration in Re California, 28 Land Dec. 57, and has been uniformly
followed ever since. Re New Mexico, 29 Land Dec. 364; Re School Land
Opinion, 30 Land Dec. 438; Dunn v. California, 30 Land Dec. 608; Re New
Mexico, 34 Land Dec. 599; Re California, 34 Land Dec. 613.

12

In the brief presented by leave of court on behalf of the United States it is set
forth that the rule laid down in Re California, 28 Land Dec. supra, is still
adhered to by the Land Department; that selections aggregating many
thousands of acres have been made in reliance upon it, and that no doubt large
expenditures of money have been made in good faith upon the selected lands. It
is therefore urged that such construction has become a rule of property. In this
situation we should be slow to disturb a ruling of the department of the
government to which is committed the administration of public lands.
McMichael v. Murphy, 197 U. S. 304, 49 L. ed. 766, 25 Sup. Ct. Rep. 460.

13

Furthermore, the reasoning upon which the departmental interpretation is

founded commends itself to our judgment as best calculated to carry out the
purposes intended to be accomplished by the statute in question.

14

It follows that the Supreme Court of California erred in its decision of the
Federal question involved. With the state questions we have no concern, their
ultimate solution being a matter for that court. The judgment is reversed and
the cause remanded to that court for further proceedings not inconsistent with
this opinion.

15

Reversed.

"Sec. 2275. Where settlements with a view to pre-emption or homestead have

been, or shall hereafter be made, before the survey of the lands in the field,

which are found to have been made on sections sixteen or thirty-six, those
sections shall be subject to the claims of such settlers; and if such sections, or
either of them, have been or shall be granted, reserved, or pledged for the use of
schools or colleges in the state or territory in which they lie, other lands of
equal acreage are hereby appropriated and granted, and may be selected by said
state or territory, in lieu of such as may be thus taken by pre-emption or
homestead settlers. And other lands of equal acreage are also hereby
appropriated and granted, and may be selected by said state or territory where
sections sixteen or thirty-six are mineral land, or are included within any
Indian, military, or other reservation, or are otherwise disposed of by the
United States: Provided, where any state is entitled to
said sections sixteen and thirty-six, or where said sections are reserved to any
territory, notwithstanding the same may be mineral land or embraced within a
military, Indian, or other reservation, the selection of such lands in lieu thereof
by said state or territory shall be a waiver of its right to said sections. And other
lands of equal acreage are also hereby appropriated and granted, and may be
selected by said state or territory to compensate deficiencies for school
purposes, where sections sixteen or thirty-six are fractional in quantity, or
where one or both are wanting by reason of the township being fractional, or
from any natural cause whatever.' And it shall be the duty of the Secretary of
the Interior, without awaiting the extension of the public surveys, to ascertain
and determine, by protraction or otherwise, the number of townships that will
be included within such Indian, military, or other reservations, and thereupon
the state or territory shall be entitled to select indemnity lands to the extent of
two sections for each of said townships, in lieu of sections sixteen and thirty-six
therein; but such selections may not be made within the boundaries of said
reservations: Provided, however, That nothing herein contained shall prevent
any state or territory from awaiting the extinguishment of any such military,
Indian, or other reservation and the restoration of the lands therein embraced to
the public domain, and then taking the sections sixteen and thirty-six in place
therein; but nothing in this proviso shall be construed as conferring any right
not now existing.
'Sec. 2276. That the lands appropriated by the preceding section shall be
selected from any unappropriated, surveyed public lands, not mineral in
character, within the state or territory where such losses or deficiencies of
school sections occur; and where the selections are to compensate for
deficiencies of school lands in fractional townships, such selections shall be
made in accordance with the following principles of adjustment, to wit: For
each township, or fractional township, containing a greater quantity of land
than three quarters of an entire township, one section; for a fractional township,
containing a greater quantity of land than one half, and not more than three

quarters of a township, three quarters of a section; for a fractional township,

containing a greater quantity of land than one quarter, and not more than one
half of a township, one-half section; and for a fractional township containing a
greater quantity of land than one entire section, and not more than one quarter
of a township onequarter section of land: Provided, That the states or territories
which are, or shall be entitled to both the sixteenth and thirty-sixth sections in
place, shall have the right to select double the amounts named, to compensate
for deficiencies of school land in fractional townships.'